E1 & E2 Transaction

[Asked by Guest]

Dear Seniors,

A is the Material Manufacturer in Jabbalpur CG

B is the Dealer in Noida, UP

C Customor/Consignee Shajanpur, UP

My Question is:

Is the below transaction "Sale In Transit / E1 Transaction" or not ?.

B purchases the material from A under CST biling and B prepare a Invoice without any tax amount to C.

the material A Delivers in the name of B as a buyer & directly send to C and B Endorse the L.R.in the name of C. so, material collects by C

and A issues "E1" form to B and collects Form"C" from B and B collect Form "C" from C & issues E2 Form to C

Please guide me.

[ALOKE GHOSH]

Dear Mr.Burman

The Transaction clearly covers under section 6(2) of the CST Act,1956 ,i.e subsequent sale and required forms are E1 & E2. Please get it confirmed that while raising Invoice by M/s A for such sale, the name of M/s B has been stated as Buyer and the name of M/s C is stated as Consignee and since there is inter state movement the same is covered under the said section.

Thanks

Aloke Ghosh

[vittal Rao]

 

"E1" refers to sales in transit .  i.e., the sale is effect ed to a buyer who has ordered with another buyer, for whom the the material transhipment  us under way.

vittal rao

[JSWSEVERFIELD STRUCTURESLIMITED]

Dear Mr. Burman,

If Goods destination ends at C-UP then no question of issuing E-II. If the Goods are attracting further movement then the question of E-II comes and B has to issue E-II.

Please correct me if am wrong.

Dear All,

Thanks for your reply.

But my question is that how to I will do billing to C. We (B) & C we are in same state. I will put any tax in our invoice or only charge as per our order value (Manufacturer Value + our profit)

Please help my.

Thanks & Regards

M Barman

M: +919958352480

[JSWSEVERFIELD STRUCTURESLIMITED]

Dear Burman,

You may have to raise Commercial Invoice / Bill in Transit adding Value +  profit, you have to show Actual CST charged by A

[Vinay Singh]

Dear Mr. Burman

How much amount of C form will be issued by C to B.

A invoice to B for Rs.102/- including CST Rs.2

B Invoiced to C for Rs.120/- including CST Rs.2 as per A invoice.

Now tell me amount of Cst C form to be issued in format 1 or 2 given below

1) Amount Rs. 118/- + CST Rs.2/- = Total Value Rs.120/-

2) Amount Rs. 117.64/- + CST RS.2.36/- = Total Value Rs. 120/-

[Vinay Sharma]

One More question added to question raised by Mr. Vinay Singh.

What will be tax liability on Rs. 18 ( i.e. Rs. 120-102).

Since B & C both are in UP Sale of Rs. 18 to be regarded as Loacal or Central (E1)

Thanks & Regards

 

 

 

[Vinay Sharma]

Dear Expers,

Please reply our query.

Regards

AI Summary

Sale in transit requires transit documentation and invoices reflecting supplier tax and consignee details for inter state movement.
Sale in transit occurs where a manufacturer invoices a dealer as buyer while consigning goods directly to a consignee in another State; such inter state movement is covered by the CST Act provision for subsequent sales and requires transit documentation (E1/E2) with the seller naming buyer and consignee on invoice. If destination ends at the consignee's State no downstream form is needed; otherwise the intermediary must issue the downstream form. The intermediary should invoice the consignee for manufacturer value plus margin, showing the manufacturer's inter state tax, while practical questions remain about Form C computation and tax treatment of the dealer's margin when dealer and consignee are in the same State.